Cold Chain Challenges: Opportunities and Obstacles for Pharmaceutical Logistics, Part II
Pharma Logistics: Facing the Challenges
In the previous part of our series on Pharmaceutical Logistics, we revealed the growing demand for rapid and time critical transportation of key drugs in today's interconnected world. As the pharmaceutical industry continues to see consistent growth, air freight cargo operators have a great opportunity to leverage their competitive advantage to fill this need. In this article, we'll show you some of the unique challenges presented by pharmaceutical logistics, and then show you how advanced cargo management software can address many of these issues.
To fully capitalize on the need for time critical pharma transportation, airlines must sort out multiple challenges at multiple touch-points throughout the entire supply chain, including:
Traceability: The process of handover of shipments and the associated documents offers its own challenges in that most of the time it is impossible to trace cargo once it is handed over to the forwarder.
Integrity: The risk from pilferage is multi-fold as it puts the entire contingent at risk. Drugs that are compromised reaching the market and are promptly administered to patients carry a huge risk not only for the patient, but also pose a major liability threat for the drug manufacturer and other parties in the chain as well.
Transportation, Handling and Storage: The possibility of temperature excursion inside the transport vehicle and improper handling by untrained forwarder/ trucking/ airline staff also represents a potential risk.
Infrastructure: Huge commitments in terms of effort and money from supply chain participants to properly implement this system will represent a big hurdle for future airfreight providers. Infrastructure required to support pharma operations is a major challenge for all parties involved.
Huge investments in terms of specialist warehouses with temperature controlled zones are required for an efficient cold chain supply chain – which are quite expensive to build and maintain. In US and Europe which are the industry's major markets, business is more mature and players have the infrastructure in place that ensures competitive products and pricing. However, in the remaining parts of the world, cost remains high and lowering of cost can come only through economies of scale in shipping and handling.
Regulatory Framework: The most important challenge however, is not one that can be solved by individual companies. As is often the case, conflicting regulatory regimes imposed by governments impede the efficient movement of goods. Nations all over the world have their own versions of control imposed on drug transportation by air leading to more hassles, delays and cost.
In another crucial element, the regulatory requirements governing transport of temperature sensitive pharma by air are also becoming more stringent. In addition to EU's Good Distribution Practice (GDP), organizations like the World Health Organization (WHO) are coming up with new and improved regulatory frameworks covering security and counterfeiting along with managing temperature excursions.
IATA has its own Chapter 17 - Air Transport Logistics for Time and Temperature Sensitive Healthcare products with global standards. IATA also has the CEIV pharma certification program (Center of Excellence for Independent Validators) with the aim of helping the industry improve the transport and handling of pharma products. A single world-wide quality standard is clearly absent in the industry and is an absolute must-have for the industry to flourish and its participants to mature.
While these obstacles might seem daunting, companies and regulatory organizations are working today to clear away the regulations and develop next generation solutions for the pharmaceutical industry. In our final and most exciting post on this topic, we'll demonstrate how governments and regulatory bodies can solve these issues and show you one company that has built up the IT infrastructure to successfully address these obstacles.